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SARASOTA, Fla. – Aug. 28, 2015 – In July, once again, Florida was tops in the nation in terms of single-family homes and condominiums bought with no financing.

Led by the city of Sebastian, markets throughout the state claimed the first nine spots on RealtyTrac’s list of metropolitan areas with the greatest share of cash real estate deals.

Some 54.6 percent of homes in Sebastian were purchased without a mortgage last month, compared to about 43 percent for Florida as a whole and an eight-year low of just 22.6 percent for the country overall.

Other leading Florida destinations for cash deals included Homosassa Springs, Sebring, Naples, Port St. Lucie, Charlotte County, and Sarasota-Manatee.

South Florida one of least affordable rental markets in country

Rent takes a bigger chunk of your paycheck in South Florida than almost anywhere in the nation, and the burden is getting heavier.

Renters here, on average, spend 44 percent of their incomes for a place to live, far more than the national average of 30 percent, according to new data from Zillow.com, a home listing service.

South Florida’s rent burden ranks third-highest in the country, on par with San Francisco, Zillow found. Only Los Angeles, where 48 percent of income goes to rent, and Sarasota (47 percent) rank higher.

Although rents have risen across the country, their bite in South Florida is growing more quickly. Ten years ago, renters here paid 34 percent of their income for rent, closer to the national average of 26 percent, according to Zillow, which derives its data from rental listings and sales of rental homes.

The rental burden in South Florida has climbed 29 percent since then, compared with 15 percent nationally.

“The renter feels trapped,” said Ken Johnson, areal estate economist and associate dean at Florida Atlantic University. “They don’t have a lot of choices, and they can’t easily get out to become a homeowner.”

Tina Honey, 48, is one of them.

Last November, Honey moved to an apartment in Delray Beach, renting a three-bedroom unit for $1,861 a month. When she received her renewal notice recently, it included a $112-a-month increase.

Honey wants to find another place by the end of September, when she has to give her landlord two months’ notice. But so far she hasn’t seen a comparable, cheaper apartment in her school district, where her 16-year-old son attends Spanish River High School.

“I just think the rentals down here are ridiculous,” said Honey, a project manager for Office Depot who grew up in Detroit. “There’s no rent control, so they can charge whatever they want. That’s crazy.”

Frank Medina, 55, moved out of his one-bedroom Wilton Manors apartment complex rather than pay an extra $300 a month that would have increased the rent to $1,900.

Medina now rents a two-bedroom duplex in Oakland Park for $1,200. He likes the setup but wishes he could afford to live closer to his job as a receptionist and administrative assistant for the Genovese Joblove & Battista law firm in downtown Fort Lauderdale. He said most of the new apartments cater to people making at least $50,000 a year. The shimmering new buildings have turned into “revolving-door rentals,” he said.

“They don’t care if you stay or not,” Medina said. “There’s no rent control here, so you’re at their mercy. It’s madness. Complete madness.”

In Broward County, the median rent has increased to $1,378 from $1,243 three years ago. But pay has not kept up. The county’s $61,800 median household income is the same as it was in 2011, according to the U.S. Department of Housing and Urban Development.

The situation is the same in Palm Beach County. The median rent has increased to $1,364 from $1,173 three years ago, but the county’s $63,300 median household income is unchanged from 2011.

Abby Blake is caught in the trap. She has struggled to find somewhere for less than $1,000 a month, the amount she can afford after her roommate decided to move out of their two-bedroom rental condominium west of Boca Raton. Blake can’t swing the $1,100 rent alone and needs to find a place before her lease expires Sept. 30.

If she doesn’t find another roommate, the 25-year-old publicist may have to get a part-time job or ask her family for help.

“It’s starting to freak me out a little bit,” she said.

Tracy Anton, a longtime renter in Hollywood, moved to a smaller apartment in her same complex because she couldn’t afford a $100 rent increase.

Anton, who once had a 30-year career in broadcast advertising, is now a senior citizen who lives on a fixed income that doesn’t come close to keeping pace with rising rents and assorted fees.

To make ends meet, she sells items on eBay. She recently sold part of her porcelain cat collection. Before that, she parted with cutlery, clothes and luggage.

“The stress level is always high,” Anton said. “These days, the renter is always waiting for the other shoe to drop.”

Buying is not much of an alternative in South Florida’s improving housing market.

Since 2011, when the market hit bottom, the median home price in Palm Beach County has climbed more than 30 percent, compared with 18 percent nationally, according to the Realtors Association of the Palm Beaches.

The median home price in Broward County has climbed nearly 50 percent.

And many of the homes for sale are beyond the reach of first-time buyers. Less than a third of single-family homes listed in Broward County are priced at $250,000 or below, the price that Realtors consider an entry-level home. In Palm Beach County, it’s less than a fourth.

“It’s become a very thin market in that price range,” said Diane Paez, a real estate agent who sells in both counties. “Buyers just have to kind of hang out and hope something changes.”

Even as homes gallop towards the last cycle’s peak prices, it remains cheaper to buy than rent in South Florida, but the gap is narrowing, according to real estate website Trulia.com. On a monthly basis, buying is 52 percent more affordable than renting in Palm Beach County and 47 percent cheaper in Broward County. “The gap is narrowing as mortgage rates increase and home prices in South Florida continue to climb, but mortgage rates are still low compared with historical norms, and prices are still working their way back up from their post-bubble lows,” Trulia Chief Economist Jed Kolko told the Sun-Sentinel. South Florida rental rates have increased steadily in part on demand from one-time homeowners whose damaged credit scores disqualifies them for mortgages. Cash-paying investors, particularly in Miami-Dade County, often engage in bidding wars that have jacked up prices and squeezed out traditional buyers. [Sun-Sentinel] — Emily Schmall – See more at: http://therealdeal.com/miami/blog/2013/09/24/buying-a-home-cheaper-than-renting-in-s-florida/#sthash.dwava1mq.dpuf

Jumbo mortgage activity is booming. The volume of jumbo mortgages – loans above $417,000 in most places and $625,000 in some high-priced areas – reached an estimated $160 billion in the first six months of 2015 – 36 percent higher year-to-year, according to Inside Mortgage Finance.

In the first half of the year, jumbo mortgages comprised about 20 percent of all mortgage originations, marking a comeback to prerecession levels, Cecala says.

“The coastal markets are appreciating at a larger clip,” says Bill Banfield, vice president of Quicken Loans. Indeed, Total Mortgage Services, which lends in 34 states, says its hottest jumbo markets for home purchases are centered in the Carolinas, California, Connecticut and Florida.

NEW YORK CITY – Aug. 6, 2015 – Investors are flocking to farmland again, hoping to capitalize on what they view as a temporary slump in the agriculture industry that has pushed down land prices in some areas of the country, The Wall Street Journal reports. Pension plans, hedge funds and mom-and-pop investors are all reportedly increasing their interest in farmland as an investment.

One of the biggest recent waves of cropland investments by institutional investors has come from the financial services company TIAA-CREF, which announced that it raised $3 billion for its second global farmland-investment partnership. That partnership encompasses investments in North America, South America and Australia. In addition, several public-stock offerings have packaged their properties as real estate investment trusts (REITs), which opens the door to greater investments in farmland.

“Investors are betting farmland will yield good long-term returns as global food demand rises with growing populations and wealth in Asia, Africa and elsewhere,” The Wall Street Journal reports. “The amount of arable land is expected to increase only modestly, at best, due to urbanization and a lack of acreage suitable for crops.”

A main attraction to farmland is that “these are assets that are producing an essential need for society and, in many cases, into perpetuity,” says Jose Minaya, senior managing director at TIAA-CREF Asset Management.

Farmland capital values have increased an average of 4.6 percent annually since 1990, according to data from the National Council of Real Estate Investment Fiduciaries. When adding in the income that the land generates, the return has averaged 11.8 percent.

For most of the past decade, farmland values have been soaring in the Midwest, but lately have cooled due to a three-year slump in grain and soybean prices. Notably, average farmland values fell 9 percent last year in Iowa, which is the largest corn producer, and values in Illinois, the largest soybean producer, reportedly fell 1 percent to 3 percent.

The decrease in values is sparking an opportunity for investors, says Paul Pittman, chief executive of Farmland Partners and a former investment banker.

NEW YORK – Aug. 19, 2015 – A change in downpayment requirements influence a buyer’s willingness to buy more than a change in mortgage rates, according to a new study published by economists at the New York Federal Reserve.

The Fed’s survey of buyers and renters found that the impact of interest rates might be overrated when it’s compared to even small changes in downpayment requirements. Dropping the required downpayment from 20 percent to 5 percent increases the willingness to purchase, on average, by 15 percent among buyers and 40 percent among renters.

On the other hand, decreasing the interest rate on a 30-year fixed-rate mortgage raised the willingness to purchase a home by only 5 percent, on average.

Even if a mortgage rate change will save buyers more money than a lower downpayment, they still prefer the lower downpayment.

“A key takeaway is that the effect of a change in downpayment requirements on housing demand strongly depends on households’ financial situation,” say economists Andreas Fuster and Basit Zafar of the New York Federal Reserve.

“For instance, a loosening of downpayment requirements will have little effect on the willingness to purchase for … current owners with substantial equity, or of renters with substantial liquid savings. The results also imply that … measures such as a loan-to-value (LTV) cap may predominantly affect the lower end of the housing market, and that the effect on house prices will depend on the state of the economy and other asset markets.”

The Realtors organization reported that the median sale price of an existing single-family home in Broward County was $312,000 in July, 10 percent higher than a year earlier and the highest level since 2008. The number of sales of existing single-family homes in Broward totaled 1,683 in July, an 11 percent increase from July 2014. The Realtors also reported that the median sale price of existing single-family homes in Palm Beach County was 289,250 in July, up 3 percent from the same month last year. The number of sales in Palm Beach County increased to 1,810 in July from 1,515 a year earlier, a 20 percent increase. “It’s a seller’s market,” according to Wendy Newman-Scheppke, a real estate agent covering Broward and Palm Beach County. “Sellers are asking for what they need versus what the value is.” In both Broward and Palm Beach, however, there were fewer single-family home sales in July than in June, and the unsold inventory shrank. The number of homes listed for sale at the end of July was 6,233 in Broward, slightly fewer than a year earlier, and 6,761 in Palm Beach County, down 7 percent from the end of July 2014. “We’re not in any great danger of a runaway market because mortgages are still difficult to get for most households,” said John Tucillo, chief economist of Florida Realtors. [Sun Sentinel] – Mike Seemuth – See more at: http://therealdeal.com/miami/blog/2015/08/23/browards-median-home-price-hits-post-2008-peak/?utm_source=rss&utm_medium=rss&utm_campaign=browards-median-home-price-hits-post-2008-peak#sthash.04HMCp8p.dpuf

NEW YORK – Aug. 24, 2015 – Mortgage shoppers increasingly turn to credit unions to get a mortgage, according to new research by TransUnion.

Credit unions’ share of all mortgage originations has grown considerably over the last two years – from 7 percent in the first quarter of 2013 to 11 percent in the first quarter of 2015, according to TransUnion.

“Mortgage originations had declined substantially across the board in the last few years; however, the decline had been less dramatic for credit unions,” says Nidhi Verma, director of research and consulting in TransUnion’s financial services business unit. “In the last year alone, it appears significantly more credit union executives are seeing growth in this area. Credit unions are becoming bigger players in the mortgage loan market, something that may serve them well in the future as the housing market continues to recover.”

Credit unions saw 25 percent growth in non-prime mortgage originations in the first quarter of 2015 while the rest of the industry increased at 4 percent.

“As the U.S. economy continues to recover, non-prime mortgage originations are growing for both credit unions and the rest of the industry,” said Verma. “Historically, credit unions have seen lower delinquency rates than the rest of the industry, and their focus on membership expansion makes them well-positioned to take advantage of this growth.”